This debate has increased significance in Michigan where the state police are using a device that dumps your phone. It doesn't matter whether its password protected or not.
That's an appeal waiting to happen. Forget the $500,000.00 requirement, you can't use that evidence against me if you seized it illegally. I don't see how the contents of a cell phone can be seized legally.
(The only - horrible - exception is if a person doesn't have standing to contest the seizure. For example, if they extract the data from a user's phone & use that to bust the dealer, the dealer might not have a remedy because the dealer doesn't have any expectation of privacy in the user's cell phone.)
http://news.cnet.com/8301-17938_105-20055431-1.html
Note this began during the previous Democratic Gov. Jennifer Granholm's rein.
Its been reported that one interesting development from this practice has been that drug dealers no longer conduct business using iPhones.